8-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): July 29, 2010

Federal Home Loan Bank of Pittsburgh
__________________________________________
(Exact name of registrant as specified in its charter)

Federally Chartered Corporation	000-51395	25-6001324
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
601 Grant Street, Pittsburgh, Pennsylvania		15219
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

Registrant’s telephone number, including area code: 412-288-3400

Not Applicable
______________________________________________
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On July 29, 2010 the Federal Home Loan Bank of Pittsburgh (the "Bank") issued a press release to report the Bank’s financial results for the quarter ended June 30, 2010. Attached as Exhibit 99.1 to this Current Report on Form 8-K is a copy of the related press release.

Item 7.01 Regulation FD Disclosure.

The information set forth under Item 2.02 is also furnished pursuant to this Item 7.01. The information being furnished pursuant to Item 2.02 and Item 7.01 of this Current Report on Form 8-K and the information contained in Exhibit 99.1 shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(c) Exhibits

99.1 Press release dated July 29, 2010 issued by the Bank

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Federal Home Loan Bank of Pittsburgh
July 29, 2010	By:	Kristina K. Williams
		Name: Kristina K. Williams
		Title: Chief Financial Officer

Exhibit Index

Exhibit No.	Description
99.1	Press release dated July 29, 2010 issued by the Bank

EX-99.1

Press Release

Contact: Terri McKay, FHLBank Pittsburgh: 412-288-2830; cell 412-523-8511 tmckay@fhlb-pgh.com

FHLBANK PITTSBURGH ANNOUNCES SECOND QUARTER 2010 FINANCIAL RESULTS

PITTSBURGH, July 29, 2010 – The Federal Home Loan Bank of Pittsburgh (FHLBank) today announced unaudited financial results for second quarter 2010. The Bank recorded a net loss for the quarter. All regulatory capital requirements were exceeded at June 30, 2010.

Operating Results
For the second quarter of 2010, the Bank recorded a net loss of ($68.2) million compared to net income of $32.1 million in second quarter 2009. This decline in results was driven by higher other-than-temporary impairment (OTTI) credit losses on the Bank’s private-label mortgage-backed securities (MBS) portfolio. OTTI credit losses were $110.7 million for second quarter 2010 compared to $39.3 million for second quarter 2009.

For the six months ended June 30, 2010, the Bank recorded a net loss of ($58.3) million compared to net income of $8.5 million for the same prior-year period primarily due to higher OTTI credit losses year-over-year.

The credit portion of the Bank’s OTTI losses is based on projected losses on the collateral underlying certain of the Bank’s private-label residential MBS. Each quarter, working with the FHLBank System OTTI Governance Committee, the Bank updates its OTTI analysis to reflect loan performance and current housing market assumptions in its collateral loss projection models, which generate these forecasted losses.

During the second quarter of 2010, this update process resulted in more pessimistic input assumptions based on current and forecasted economic trends affecting the underlying loans. Such trends include continued high unemployment, ongoing pressure on housing prices and limited refinancing opportunities for borrowers whose houses are now worth less than the balance of their mortgages.

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601 Grant Street • Pittsburgh, PA 15219-4455 • 412-288-3400 • www.fhlb-pgh.com

FHLBank Pittsburgh Reports Second Quarter 2010 Results – page two

Prime 2007 and 2006 vintage bonds had the most severe impact, representing $91.8 million of the $110.7 million second quarter 2010 OTTI credit losses. In addition to assumption changes, certain prime 2007 and 2006 vintage bonds have experienced performance deterioration in the form of higher loan level delinquencies and/or a reduction in the level of credit enhancement available to the securities.

The Bank continues to actively monitor the credit quality of its private-label MBS. The magnitude of additional OTTI charges in future periods depends on the actual performance of the underlying loan collateral as well as the Bank’s future modeling assumptions. Many factors could influence the Bank’s future modeling assumptions including economic, financial market and housing market conditions. If performance of the underlying loan collateral deteriorates and/or the Bank’s modeling assumptions become more pessimistic, the Bank could experience further losses on its portfolio.

The vast majority of the securities in the Bank’s private-label MBS portfolio were AAA-rated at the time of purchase. Based on the performance of certain securities, among other information, it appears that the underwriting standards represented in the offering materials for these securities were not followed. As a result, the Bank owns certain private-label MBS, which it otherwise would not have owned, on which it has recognized losses. The Bank has filed lawsuits against certain issuers, underwriters and rating agencies related to these misrepresentations.

Balance Sheet Highlights
Advances totaled $36.1 billion at June 30, 2010, a decrease of $5.1 billion, or 12.4%, from a balance of $41.2 billion at December 31, 2009. Demand for advances has continued to decline primarily due to higher member deposits and low member demand. At June 30, 2010, total assets were $60.6 billion, a decrease of $4.7 billion, or 7.1%, from a balance of $65.3 billion at December 31, 2009. Total capital at June 30, 2010 was $4.0 billion, an increase of $254.8 million, or 6.9%, from $3.7 billion at December 31, 2009. The portion of OTTI losses previously reported as noncredit losses in accumulated other comprehensive income (loss) (AOCI) improved from ($691.5) million at December 31, 2009 to ($373.7) million at June 30, 2010. This improvement was due to paydowns, price appreciation in the private-label MBS portfolio, and the reclassification of certain noncredit losses to credit losses in second quarter 2010. Retained earnings at June 30, 2010 were $330.7 million, down $58.3 million due to the year-to-date June 2010 net loss. At June 30, 2010, the Bank had regulatory capital of $4.4 billion and exceeded all regulatory capital requirements.

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FHLBank Pittsburgh Reports Second Quarter 2010 Results – page three

On December 23, 2008, the Bank’s management and Board of Directors announced the suspension of both dividend payments and the repurchase of excess capital stock until such time as it becomes prudent to reinstate either or both. These suspensions remain in effect and, therefore, no dividends were declared or paid in the first six months of 2010.

Detailed financial information regarding the second quarter and year-to-date June 2010 results will be available in the Bank’s second quarter 2010 Form 10-Q filing, which the Bank anticipates filing on August 9, 2010. Detailed financial information regarding 2009 is available in the 2009 Form 10-K, which can be accessed through the Bank’s web site at www.fhlb-pgh.com or on the SEC’s web site at www.sec.gov.

FHLBank Pittsburgh is a wholesale bank that serves the housing finance and community and economic development needs of its owner-members. FHLBank Pittsburgh provides reliable access to low-cost funds, competitive pricing in the purchase of mortgage loans, correspondent banking, technical assistance, affordable housing grants and other programs so members can better serve their own communities. FHLBank Pittsburgh is privately capitalized and funded, does not use taxpayer dollars, and enjoys a triple-A rating. At June 30, 2010, it had 316 members in its district of Delaware, Pennsylvania and West Virginia and approximately $61 billion in assets. FHLBank Pittsburgh is one of twelve Banks in the Federal Home Loan Bank System, established by Congress in 1932 to support the residential mortgage and community development activities of local financial institutions.

This release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are based upon our current expectations and speak only as of the date hereof. These statements may use forward-looking terms, such as “projected,” “expects,” “may,” or their negatives or other variations on these terms. FHLBank Pittsburgh cautions that, by their nature, forward-looking statements involve risk or uncertainty and that actual results could differ materially from those expressed or implied in these forward-looking statements or could affect the extent to which a particular objective, projection, estimate, or prediction is realized. These forward-looking statements involve risks and uncertainties including, but not limited to, other than temporary impairment of investment securities, regulatory and accounting rule adjustments or requirements, changes in interest rates, changes in projected business volumes, changes in prepayment speeds on mortgage assets, the cost of our funding, changes in our membership profile, the withdrawal of one or more large members, competitive pressures, shifts in demand for our products and consolidated obligations, general economic conditions (including effects on among other things, mortgage-backed securities), the Bank’s ability to maintain adequate capital levels (including meeting applicable regulatory capital requirements), business and capital plan adjustments and amendments, legislative and regulatory actions or approvals, interest-rate volatility, our ability to appropriately manage our cost of funds and the cost-effectiveness of our funding, hedging and asset-liability management activities. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

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FHLBank Pittsburgh Reports Second Quarter 2010 Results – page four

Unaudited Statements of Condition and Operations
(in millions)

	June 30,			December 31,
Statement of Condition	2010			2009
ASSETS:
Investments (1)	$	19,246.0		$	17,173.5
Advances		36,058.4			41,177.3
Mortgage loans held for portfolio, net		4,895.7			5,162.8
All other assets		429.6			1,777.3
Total Assets	$	60,629.7		$	65,290.9
LIABILITIES:
Consolidated obligations, net	$	54,443.9		$	59,312.8
All other liabilities		2,217.9			2,265.0
Total Liabilities		56,661.8			61,577.8
CAPITAL:
Total capital stock		4,012.2			4,018.0
Retained earnings		330.7			389.0
Accumulated other comprehensive loss		(375.0	)		(693.9	)
Total Capital		3,967.9			3,713.1
Total Liabilities and Capital	$	60,629.7		$	65,290.9

(1) Includes held-to-maturity securities, available-for-sale securities, trading securities, interest-bearing deposits and Federal funds sold

			For the three months						For the six
			ended June 30,						months ended June
									30,
Statement of Operations			2010			2009			2010			2009
Total interest income			$	245.5		$	388.6		$	491.5		$	866.4
Total interest expense				186.4			312.7			373.4			734.1
	Net interest income			59.1			75.9			118.1			132.3
Provision (benefit) for credit losses				(1.3	)		1.1			(1.4	)		1.5
Total OTTI losses				(20.4	)		(460.2	)		(22.6	)		(785.0	)
Portion of OTTI losses recognized in other
	comprehensive loss			(90.3	)		420.9			(115.7	)		715.2
	Net OTTI losses			(110.7	)		(39.3	)		(138.3	)		(69.8	)
All other income (loss)				(6.3	)		14.9			(8.2	)		(19.0	)
All other expense				15.1			15.3			31.3			30.5
	Income (loss) before assessments			(71.7	)		35.1			(58.3	)		11.5
Affordable Housing Program				(1.1	)		0.9			-			0.9
REFCORP				(2.4	)		2.1			—			2.1
	Total assessments			(3.5	)		3.0			0.0			3.0
		Net Income (Loss)		($68.2	)	$	32.1			($58.3	)	$	8.5

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